Sales/Use/Indirect:
Iowa: Proposed Rule Incorporates DOR Interpretations on Taxation of Digital-Based Services
Proposed New Rule 701 – Chapter 211, Iowa Dept. of Rev. (10/5/22). The Iowa Department of Revenue (Department) proposed a new rule that reflects its current informal guidance on legislation enacted in 2018 [see S.F. 2417 (2018) and previously issued Multistate Tax Alert for more details on this 2018 Iowa legislation], which expanded Iowa’s sales and use tax base to include a variety of digital-based services. In doing so, the Department seeks to adopt its policy interpretations into binding administrative rules. Among other services, the proposed rule addresses the taxability of information services; software as a service (SaaS); video game services and tournaments; services related to specified digital products or software sold as tangible personal property; storage of tangible or electronic files, documents, or other records; and webinars. Written comments on the proposal are due by October 25, 2022, and a related public hearing is scheduled for the same date. Please contact us with any questions.
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